For years, the federal government has handed out hundreds of millions of dollars in contracts to care for migrant children without taking into account whether the contractor’s license is suspended or under investigation. 

That would change if a group of bipartisan lawmakers can find support for new legislation introduced this month. 

During a rapid expansion of its shelter network for migrant children in 2019, the U.S. government approved millions of dollars in funding to shelter providers with little experience and troubling track records, an investigation by Reveal from The Center for Investigative Reporting and WRAL News found. 

One such group, New Horizon Group Home, had its license revoked the previous year by North Carolina authorities, after inspectors found conditions inside that presented “an imminent danger” to children. The facility had been open for just five months.

Yet the Office of Refugee Resettlement, the federal agency that oversees the care of unaccompanied children, gave nearly $4 million to New Horizon in April 2019. 

The shelter, which would have accommodated up to 72 children, never opened. Following our investigation, state officials denied New Horizon’s application for a residential child care license to run the shelter. Under North Carolina law, care providers with a revoked license cannot receive any new license for five years. In New Horizon’s case, it would not be eligible for a new license until at least 2023. 

Democratic U.S. Rep. David Price of North Carolina is one of the four lawmakers who proposed the bill Nov. 4, which would require grant applicants to be licensed by the state in which they are operating, as well as disclose any license suspensions or pending investigations within the last five years. 

“After being alerted to a troubling situation in my home state of North Carolina, I learned that a larger problem existed in how ORR was awarding shelter grant funding,” Price said in a statement. “It is a question of fiscal responsibility and a larger question about our nation’s immigration policy and the way people are being treated. I was troubled that our federal government would contract with an outfit whose license had been suspended by the state, and that this was part of a larger pattern. Unaccompanied children are some of the most vulnerable individuals in our care, and they deserve to be safely housed.”

Price is joined by Republican U.S. Rep. Mariannette Miller-Meeks of Iowa and U.S. Sens. Tom Carper (D-Delaware) and Rob Portman (R-Ohio) in sponsoring the legislation.

Following our investigation, Lynn Johnson, then the assistant secretary for the federal Administration for Children and Families, said in a letter to lawmakers that grant applicants were previously not required to disclose violations or license suspensions, but that going forward, federal officials would contact state agencies to request “any other information that would impact the ability to provide licensed capacity and safely care” for children.

The Reveal and WRAL News investigation was also cited in a 2020 report from the Senate’s Permanent Subcommittee on Investigations that found the government did not properly vet the disciplinary histories of grant applicants, including New Horizon, before distributing millions of dollars. “This means that taxpayers have paid for facilities that will never open,” the report states. Additionally, the subcommittee found that the government had yet to recover the money it gave New Horizon.

The subcommittee report also focused on another child care provider, VisionQuest. In 2019, Reveal broke the story about VisionQuest’s proposal to open a shelter in Los Angeles. For decades, scandals plagued the company, which was repeatedly investigated for violent handling of children. After our reporting, Los Angeles became one of at least six cities or states that blocked VisionQuest’s efforts to open shelters.

This story was edited by Andrew Donohue and copy edited by Nikki Frick. Laura C. Morel can be reached at lmorel@revealnews.org. Follow her on Twitter: @lauracmorel.

Laura C. Morel is a reporter for Reveal, covering immigration.

She previously was a reporter at the Tampa Bay Times, where she covered criminal justice issues. She was a 2017 finalist for a Livingston Award, which recognizes young journalists, for an investigation with two other reporters into Walmart’s excessive use of police resources.

In 2016, Morel became one of Reveal’s inaugural investigative fellows. The program, aimed at increasing diversity among the ranks of investigative journalists, offers reporters embedded at their home outlets the training and mentoring to pursue an investigative project. Morel’s fellowship project exposed the extent of Florida’s gun theft problem.